Brendan Creswick v Bailey Designed Engineering Pty Ltd

[2013] FWC 8830

[2013] FWC 8830

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.394—Unfair dismissal

Brendan Creswick
v
Bailey Designed Engineering Pty Ltd
(U2013/10603)

DEPUTY PRESIDENT KOVACIC MELBOURNE, 11 NOVEMBER 2013

Application for relief from unfair dismissal - application for costs following discontinuance of application for remedy.

[1] On 17 June 2013 an application was made on behalf of Mr Brendan Creswick (the Applicant) under s.394 of the Fair Work Act 2009 (the Act) for an unfair dismissal remedy. The Applicant alleged that his dismissal by Bailey Designed Engineering Pty Ltd (the Respondent) on 29 May 2013 was unfair. The Respondent subsequently raised a jurisdictional objection claiming the Applicant had abandoned his employment. The jurisdictional objection was listed for hearing on 26 September 2013. However prior to that hearing, on 23 September, the Applicant filed a notice of discontinuance with the Fair Work Commission (the Commission).

[2] The day after the Applicant discontinued his application, the Respondent made an application for costs.

[3] Both parties agreed to the Commission dealing with the application for costs on the papers.

Background

[4] The Applicant had been engaged by the Respondent as a casual employee on 4 April 2012. The Applicant asserted that on or about 20 February 2013 the Respondent employed the Applicant as a full-time Engineering-Fabrication apprentice under a MEGT Australian Apprenticeships Centre Training Contract. This is disputed by the Respondent. The Applicant further asserts that from about mid-April 2013, despite presenting for work, he was stood-down by the Respondent due to a lack of work. The Respondent was unable to confirm or deny if the Applicant had presented for work from that time onwards, though he did state that the staff members specified in the Applicant’s witness statement did not recall seeing the Applicant on the dates specified in his witness statement. On 28 and 29 May 2013, the Respondent indicated in emails to the Applicant’s father that the Applicant had abandoned his employment. Beyond that, no material was presented to the Commission indicating that the Respondent had directly communicated with the Applicant advising him that he had been dismissed or that he considered the Applicant had abandoned his employment.

[5] On the other hand, the Respondent asserted that the Applicant had failed to turn up for work over 60 times in the previous year and failed to provide a valid reason for his absences leading to a conclusion that the Applicant had abandoned his employment. As noted above, the Respondent raised a jurisdictional objection claiming the Applicant had abandoned his employment.

[6] The Commission listed the matter for conciliation on 24 July 2013. The conciliation did not proceed as the Respondent did not attend. Further attempts to arrange a conciliation conference were unsuccessful. As a result, a conciliator with the Commission emailed the parties on 29 July 2013 advising that the application had been referred to a Commission member for formal proceedings.

[7] On 1 August 2013, the Applicant’s legal representative wrote to the Respondent setting out an offer to resolve the matter. The Commission is not aware of any formal response from the Respondent.

[8] On 23 August 2013, the Commission listed the jurisdictional matter for hearing on 25 and 26 September 2013 and issued Directions for the provision of an outline of submissions, witness statements and any other documentary material to be relied upon by the parties. A revised listing was issued on 12 September 2013, indicating that the matter was to be listed for one day only, 26 September 2013.

[9] On 30 August 2013 the Respondent submitted his outline of submissions, witness statements and other documentary material. Among other things, the Respondent:

(i) asserted that the Applicant was only ever engaged as a casual employee;

(ii) indicated that, while he had signed up the Applicant to a training course, prior to an offer of full-time employment being confirmed the Applicant went absent without notice and was unreachable; and

(iii) reiterated that the Applicant regularly failed to turn up to work and did not provide reasons for his absences.

[10] The Respondent also foreshadowed that he would be seeking costs “for the wasted time we have had to take to deal with this issue.”

[11] After being granted an extension of time, the Applicant submitted his outline of submissions and associated material late on 20 September 2013. In short, the Applicant:

(i) disputed that he had abandoned his employment;

(ii) indicated that his absences from work were due to migraines, adding that he had suffered from cluster migraines since he was eight years old;

(iii) provided medical certificates covering a number of dates over the period September 2012 to May 2013;

(iv) asserted that he suspected that since about mid-April 2013 the work he had previously performed for the Respondent was undertaken by a new employee who commenced with the Respondent at around that time;

(v) subsequent to signing the training contract he had continued to present for work but was informed that there was no work for him, adding that he had not been asked to perform work by the Respondent after mid-April; and

(vi) indicated that he had only learnt of his dismissal/alleged abandonment of his employment as a result of emails the Respondent had sent to his father.

[12] The Respondent subsequently provided the Commission with a document which responded paragraph by paragraph to the Applicant’s witness statement. In that document, the Respondent disputed much of the witness statement.

[13] As noted above, the Applicant filed a Notice of Discontinuance on 23 September 2013.

The legislation

[14] Section 611 of the Act provides that generally in matters before the Commission the parties must bear their own costs, though the Commission has the discretion to order one party to bear some of the costs of the other party in some limited circumstances. The section is set out below:

“611 Costs

(1) A person must bear the person’s own costs in relation to a matter before the FWC.

(2) However, the FWC may order a person (the first person) to bear some or all of the costs of another person in relation to an application to the FWC if:

(a) the FWC is satisfied that the first person made the application, or the first person responded to the application, vexatiously or without reasonable cause; or

(b) the FWC is satisfied that it should have been reasonably apparent to the first person that the first person’s application, or the first person’s response to the application, had no reasonable prospect of success.

Note: The FWC can also order costs under sections 376, 400A, 401 and 780.

(3) A person to whom an order for costs applies must not contravene a term of the order.

Note: This subsection is a civil remedy provision (see Part 4-1).”

[15] In this instance the question is whether the Commission is satisfied that the Applicant either made his application vexatiously or without reasonable cause or that it should have been reasonably apparent to him that the application had no reasonable prospect of success.

[16] A number of Full Bench decisions have considered the approach to be taken regarding s.611 of the Act. These decisions 1 commonly refer to the two decisions below with authority:

In A Baker v Salva Resources Pty Ltd 2, a Full Bench of FWA summarised the approach to be taken in relation to subsection 611(2)(b) of the Act as follows:

“[10] The concepts within s.611(2)(b) ‘should have been reasonably apparent’ and ‘had no reasonable prospect of success’ have been well traversed:

• ‘should have been reasonably apparent’ must be objectively determined. It imports an objective test, directed to a belief formed on an objective basis, rather than a subjective test; and



• a conclusion that an application ‘had no reasonable prospect of success’ should only be reached with extreme caution in circumstances where the application is manifestly untenable or groundless or so lacking in merit or substance as to be not reasonably arguable.”

On the question of what constitutes “without reasonable cause”, Justice Wilcox in Re Joseph Michael Kanan v Australian Postal and Telecommunications Union 3 said that:

“It seems to me that one way of testing whether a proceeding is instituted “without reasonable cause” is to ask whether, upon the facts apparent to the applicant at the time of instituting the proceeding, there was no substantial prospect of success. If success depends upon the resolution in the applicant’s favour of one or more arguable points of law, it is inappropriate to stigmatise the proceeding as being “without reasonable cause”. But where it appears that, on the applicant’s own version of the facts, it is clear that the proceeding must fail, it may properly be said that the proceeding lacks a reasonable cause.”

Submissions

[17] The Respondent’s Application for Costs cites the following as the grounds for the application:

“1.) Time involved in verifying document supplied by the solicitors and replying to their emails for around 20 times.

2.) Time & Effort to assess all two years old documents regarding the employee, payslips and statement from director and employees to submit to fair work commission.

3.) Disruption of work schedule for the director and employees.

4.) To assess all the statements and exhibits given by the applicant and others in support of the applicant and cross verify with the facts and reply to it.

5.) To hire a book keeper to reassess the payslips and other records submitted by the applicant and cross verify it with the correct originals an re check the entire employee’s payroll for two years.

6.) Legal costs involved in seeking legal advice.

7.) Defamation.” 4

[18] The Respondent’s submission on the issue of costs did not address any of the grounds in s.611(2) of the Act, but rather simply detailed/itemised the costs which the Respondent was seeking.

[19] It was submitted on the Applicant’s behalf that no costs order should be made against either the Applicant or his legal representatives as:

(i) costs refers to legal costs or the cost of paid agents providing advice;

(ii) in this case the costs detailed by the Respondent in the main did not relate to such costs and, where they did, no supporting invoices were provided;

(iii) with regard to s.611(2) of the Act, the Applicant did not make his application vexatiously or without reasonable cause as there were reasonable prospects of success; and

(iv) the basis for costs being awarded under either s.400A or s.401 of the Act were not present in this case.

Consideration

[20] There is no doubt that the Respondent feels aggrieved at having had to undertake preparatory work to defend an application in circumstances where he considers the application had no merit. However, with regard to the requirements of s.611(2) of the Act the Respondent has not provided any material which would support a finding that the application was made vexatiously.

[21] As to whether the application was made without reasonable cause, from paragraphs [9] to [11] above it is apparent that much of the material in this matter is disputed. For instance, the Respondent submits that the Applicant was frequently absent from work and did not inform the Respondent of the reason for the absence, whereas the Applicant asserts that he was absent due to medical reasons and that the Respondent was aware of this. Conversely, the Applicant asserts that from mid-April 2013 he continued to regularly present for work but was informed that there was no work available for him, whereas the Respondent asserts that the Applicant abandoned his employment. Witness statements supporting the Applicant’s and Respondent’s submissions were filed with the Commission prior to the application being discontinued.

[22] Based on the material before the Commission, I cannot be satisfied that the application was made without reasonable cause. In my view, in circumstances such as those existing in this case where much of the material is disputed, such a finding could only be made after a substantive hearing of the merits of the application and where the evidentiary material is tested.

[23] For the same reasons, I cannot be satisfied that it should have been reasonably apparent to the Applicant that his application had no reasonable prospect of success. The material before the Commission does not support a finding that the application had no reasonable prospect of success. Once again, as noted above, such a finding could only be made after a substantive hearing of the merits of the application and where the evidentiary material is tested.

[24] For all these reasons, I am not satisfied the grounds in s.611(2) of the Act have been made out. Accordingly, I see no basis for departing from s.611(1) of the Act which provides that “A person must bear the person’s own costs in relation to a matter before the FWC.” The Respondent’s application for costs to be ordered against the Applicant is therefore dismissed.

[25] Finally, I note that the Applicant was legally represented throughout the course of this matter. While the Respondent did not seek costs against the Applicant’s legal representative, for reasons of completeness I consider it important to indicate that no material was placed before the Commission suggesting that the Applicant’s legal representative had caused the Respondent to incur costs for any of the reasons set out in s.401(1A) of the Act.

DEPUTY PRESIDENT

 1   Timmins v Compass Security t/a Compass Integrated Security Solutions (2012) 219 IR 5 at paragraphs [15]-[21] and Mansoor v Coles Supermarkets T/A Coles Northland (2012) 227 IR 282 at paragraph [4]

 2 (2011) 211 IR 374

 3 [1992] FCA 539

 4   Application for Costs (Form F6)

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